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BACKGROUND

Governance became a critical concept in the after “IT bubble” days, as IT faced the challenge of dealing with diminishing budgets, without demand on its services being reduced proportionally. There were many initiatives and projects in the pipeline, but not all of them could be executed, given the limitations on people, infrastructure and budget. As companies looked for a way to properly classify and then prioritize the requests coming from the business, the concept of implementing a formal IT Governance process went from being a “nice to have” to a “must have” very quickly. Committees were formed to oversee the process and make sure all business areas had adequate representation when making decisions as to which projects to fund, and how much money to allocate for infrastructure capital investments. While difficult to accept at first, as many organizations operated with no rules for decades, Governance happened to be very successful aligning the IT organization to the strategic objectives of the company. The Governance process forced a discussion among the stakeholders and make sure the projects with the highest contribution to the company were executed first.

The IT Governance process worked very well for individual projects or initiatives, but it did not focus on making sure particular programs, such as Business Intelligence, were successful across the Enterprise. In order to close this gap, leading-edge companies decided to take the Governance concept down a level and focus entirely on the programs, thus giving born to the BI Governance concept. Some of these organizations defined BI Governance as the process they followed to prioritize BI requests along different criteria such as: Project ROI, Organizational Budget, Expertise of the team, People Availability, Infrastructure capacity and Organizational Politics.

This article will focus on defining BI governance, and detailing a good BI Governance process must go beyond the basics of approving and prioritizing initiatives.

DEFINING BI GOVERNANCE

BI Governance can be defined from three different, unique perspectives (Figure 1):

a) As a resource rationalization exercise. This is the traditional definition of BI Governance, a prioritization mechanism by which projects can be approved, rejected and sequenced based on specific criteria. Many companies today have some kind of process to prioritize BI requests; however most of them still rely on subjective factors to determine how a project should move forward.